Automated MaterialsInventory & Tracking

Objective

A global energy company's materials management group needed to cut costs by $1,000,000/year and drastically improve confidence in the supply chain leading to their offshore production facilities. They wanted to enable these improvements with technologies that improve safety, streamline tasks and processes and provide real-time visibility of the location and status of materials.

In the past, due to lack of confidence in the supply chain, offshore managers over-ordered and overstocked equipment and supplies. Projects were not started up until every item needed was on the platform, because having staff onboard awaiting missing materials and equipment is enormously expensive. The logistics people fielded 100 calls/day, asking essentially, "where's my stuff?"

The materials management group's objective is for their internal customers to have the same levels of confidence and visibility as customers of Amazon and FedEx.

Process

Assist in documenting requirements and developing RFI.

Bring top vendors to see and understand challenges and current processes.

Host solution demonstrations from top vendors; eliminate all but the best.

Allow remaining vendors to refine their solutions and quotes based on lessons learned.

Develop and refine business case & justification. Discern between guaranteed, "in-the-bank" benefits, benefits contingent on other groups or projects and softer benefits such as improved safety.

The Road to Success

Implementation is underway. The first priority is to get 100% accurate inventory of 65,000 pieces at roughly 50 storage sites operated by 3rd parties. In the past, a team of four attempted to cover all of these sites each year, spending up to two weeks at each site. Now each site can be inventoried in a day by 1-2 people. The next phase will tag another 65,000 items stored at a site operated by our customer and allow it to be inventoried with 100% accuracy in less than half a day. After that, RFID readers will be installed at the port facility, then on the platforms themselves.

This materials management group doesn't need to wonder whether they chose the best solution or whether it will really meet their objective. They were there and saw it all: some vendors dropped out on their own because the tests were too daunting; others revised their quotes upwards when they saw and experienced the true challenges; one vendor did well, but not great - and the winning vendor exceeded all requirements during their days of testing. Thanks to a rigorous process conducted by experts, all parties can rest assured that the solution will work and deliver the benefits.